Brits abroad: beware of investment mis-selling
Reports on investment mis-selling have barely been off the front pages in recent years, with banks and building societies publicly held to account.
How are the banks reacting to mis-selling?
Since 2010 the high street banks have been hitting the headlines for mis-selling investment products to their customers. Most of them have apologised, promised to make changes and paid out a hefty amount in fines and compensation, but investments are still being mis-sold to unsuspecting customers.
Investment Mis-Selling News Round-Up
Investment mis-selling never seems to be out of the news for long. UK banks and other financial institutions are taking steps to stop mis-selling in their sales teams, but the pressure to clean up their acts only grows as they come under increasing public scrutiny.
Investment Mis-Selling Today
Banks have paid out huge amounts in compensation for investment mis-selling in recent years, with complaints reaching a record high in 2013, but people are still largely unaware of the ways they can be mis-sold by their investment advisers.
Who are the Victims of Investment Mis-selling?
When you think of an investor, you might think of a high-flying business person. You may imagine someone living in an urban environment, with a successful career, perhaps even a penthouse and a glamorous champagne lifestyle. These are the people, you might envisage, who are most likely to be mis-sold an investment product.
How Bank Staff are Incentivised to Mis-sell Investments
Investment products are big business for UK banks. Encouraging clients to place significant sums into structured investment products or funds is a winning formula for the bank’s financial liquidity. As a result, they are motivated to promote investment products as actively as possible.
Investment Mis-selling: The Facts
According to the Financial Ombudsman Service (FOS) back in 1988, “if a financial business provided a recommendation, it had to be advice with reasonable care and skill.” Since then, complaints for mis-sold investment have continued to pour in, many related to poor financial advice and pressure selling tactics.
Time Limits On Mis-sold Investment Claims: The Facts
If you suspect you’ve been mis-sold an investment, you have the right to complain about the advice you’ve been given. But you may have heard of the so-called ‘six year rule’ that applies to compensation claims – it means that a time limit can be applied if the advice you received was given over six years ago, and you may not eligible to claim compensation as a result.
Mis-sold Investments: Banks are the worst offenders
If you want to better understand the scale of financial mis-selling in British banking, consider this: in the five years from 2011 to 2016, four of the UK’s biggest high street banks will have paid out at least £61 billion in penalties. That’s nearly double the GDP of Luxembourg.
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